THE Philippine Competition Commission (PCC) has approved Ayala Healthcare Holdings, Inc.’s (AHHI) acquisition of a majority stake in Negros Grace Pharmacy, Inc.
“In a Commission Decision approved on May 23, PCC’s merger review found that the transaction is not likely to lead to substantial lessening of competition in the relevant market since the merged firms do not have an incentive or the ability to increase its prices or reduce its product assortment,” the anti-trust body said in a statement on Monday.
The transaction involves AHHI’s purchase of 75% of the outstanding capital stock of Negros Grace from Jasminum Corp. (JC). The remaining 25% will remain with JC.
AHHI, the health care arm of the Ayala Group, owns generic pharmacy Generika Drugstore, community-based clinic brand Family Doc, online pharmacy and delivery platform MedGrocer, medical records app Vigos and doctor-patient booking app Aide.
Negros Grace and its subsidiaries, Solomon Drug Corp. and Samuel Drug Corp., have a strong regional presence in Central and Western Visayas with 70 drugstores. Its drugstore mainly sells branded drugs, and a few generic drugs.
“PCC also noted that post-transaction, sufficient number of retail players remain in the drugstore chain market in both the regional and national scope,” it added.
After the transaction, the resulting capital structure of Negros Grace will have an authorized capital stock of P100 million divided into 100 million shares with a par value of P1.00 per share, an outstanding capital stock of P100 million.
The PCC’s review looked into the deal’s impact in consumer sales of pharmaceutical products in the islands of Negros and Panay in the Visayas.
PCC, the country’s anti-trust body, is mandated under the Philippine Competition Act of 2015 to review mergers and acquisitions to ensure that these deals will not harm the interest of consumers.
To date, PCC has received 184 merger transactions by local and international companies, approved 171 of them and blocked 1 anti-competitive merger. The transactions have reached a combined worth of P2.86 trillion in terms of transaction value. — Janina C. Lim